Zillow (ZG, $97.44) to open brokerage business in January

Online real estate database company Zillow   said that it would open a brokerage firm in January.

Zillow expects the brokerage business to help streamline its e-commerce operations. 

Zillow Offers was launched in 2018 to allow customers to request instant offers and sell directly to Zillow. Zillow Offers is available in 25 markets."We're excited to add another important link in the Zillow Offers transaction chain to offer our customers greater choice and convenience when considering a move," President Jeremy Wacksman said in a statement. 

Right after the brokerage firm starts operating, customers in Atlanta, Phoenix and Tucson who sell homes through Zillow will work with a licensed employee of Zillow Homes, its new brokerage entity. 

Tickeron's  analysis shows:

Aroon Indicator for ZG shows an upward move is likely

ZG's Aroon Indicator triggered a bullish signal on September 22, 2020. Tickeron's A.I.dvisor detected that the AroonUp green line is above 70 while the AroonDown red line is below 30. When the up indicator moves above 70 and the down indicator remains below 30, it is a sign that the stock could be setting up for a bullish move. Traders may want to buy the stock or look to buy calls options. A.I.dvisor looked at 311 similar instances where the Aroon Indicator showed a similar pattern. In 253 of the 311 cases, the stock moved higher in the days that followed. This puts the odds of a move higher at 81%

Current price $97.44 is above $79.41 the highest support line found by A.I. Throughout the month of 08/24/20 - 09/24/20, the price experienced a +17% Uptrend. During the week of 09/17/20 - 09/24/20, the stock enjoyed a +2% Uptrend growth.

Technical Analysis (Indicators)

Bullish Trend Analysis

The Momentum Indicator moved above the 0 level on September 11, 2020. You may want to consider a long position or call options on ZG as a result. In 56 of 75 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 75%.

The Moving Average Convergence Divergence (MACD) for ZG just turned positive on September 16, 2020. Looking at past instances where ZG's MACD turned positive, the stock continued to rise in 31 of 41 cases over the following month. The odds of a continued upward trend are 76%.

Following a +5.46% 3-day Advance, the price is estimated to grow further. Considering data from situations where ZG advanced for three days, in 281 of 355 cases, the price rose further within the following month. The odds of a continued upward trend are 79%.

Bearish Trend Analysis

The 10-day RSI Indicator for ZG moved out of overbought territory on September 23, 2020. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 38 similar instances where the indicator moved out of overbought territory. In 20 of the 38 cases, the stock moved lower in the following days. This puts the odds of a move lower at 53%.

The Stochastic Indicator demonstrated that the ticker has stayed in the overbought zone for 6 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.

Following a 3-day decline, the stock is projected to fall further. Considering past instances where Apple declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 67%.

ZG broke above its upper Bollinger Band on September 15, 2020. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.

Fundamental Analysis (Ratings)

Tickeron has a positive outlook on this ticker and predicts a further increase by more than 4.00% within the next month with a likelihood of 65%. During the last month, the daily ratio of advancing to declining volumes was 1.92 to 1.

The Tickeron Price Growth Rating for this company is 34 (best 1 - 100 worst), indicating steady price growth. ZG’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.

The Tickeron Valuation Rating of 48 (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (5.47) is normal, around the industry mean (5.87). P/E Ratio (0.00) is within average values for comparable stocks, (87.90). Projected Growth (PEG Ratio) (0.00) is also within normal values, averaging (6.11). Dividend Yield (0.00) settles around the average of (0.33) among similar stocks. P/S Ratio (3.52) is also within normal values, averaging (7.49).

The Tickeron SMR rating for this company is 93 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.

The Tickeron PE Growth Rating for this company is 100 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.

The Tickeron Profit vs. Risk Rating rating for this company is 100 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. ZG’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 69, placing this stock worse than average.